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Industry welcomes City plan to draw up inclusionary housing policy

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The Western Cape Property Development Forum is relieved at the City of Cape Town’s announcement it will forge ahead with the drafting of an inclusionary housing policy.

The City’s decision to do a feasibility analysis in the new year will ensure such a policy is drafted to address the dire need for inclusionary housing and offer clarity to the development and construction sector, says forum chairman Deon van Zyl.

There has been speculation about how the private development community will respond to a policy that ensures more affordable units are built within every new residential development.

“It is vital that such a policy be established to in some way address the backlog of accommodation in Cape Town but, at the same time, it also needs to give certainty to the development and construction sector in terms of how it will affect that sector in terms of feasibility.”

In a media statement, the City said it aimed to have extensive engagements with industry and sector stakeholders in the development of the policy, which is also welcomed by the forum.

“The outcomes of such a policy will be successful only if the model makes business sense to the sector. This is a reason we have been keen to be involved in the policy formation with the City as we believe our sector can give insight into the production line of property, and assist in forming a policy that both the development community can embrace and that will also satisfy the expectations of the various civil society organisations .”

He says inclusionary housing policies seek to extract value on behalf of society as payment for additional development rights being granted to a developer . 

Such policies help create affordable housing by encouraging or even requiring developers to set aside a percentage of housing units within a development to be sold or rented at below market prices, or to make a contribution towards the development of affordable housing off site.

The forum’s Kabous Fouche says until now the property and construction industry has been “caught in the crossfire” between the City of Cape Town and social activist groups who object to them based on the lack of affordable units.

The forum believes Cape property developers would embrace an inclusionary housing policy, and that the sooner it is formulated, the better. This will stop the uncertainty of objections and the resulting expensive delays, and inform developers of the conditions and incentives to incorporate inclusionary housing in all residential developments. Van Zyl emphasises that the policy must make business sense . “It cannot be yet another tax on developers.…” 

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